Chances of getting a loan (co-op bank)

madmax42

Hi all,

I'm looking to purchase a new car at around 10k and am wanting to take out a loan to cover it.

I am currently earning about £1600/month (after paying into my pension) and have outgoings of around £500/month (rent & phone bill).

The reason I want to take out a loan is because I'm saving for a deposit for a house and would prefer to take out a low interest loan over 5 years instead of blowing the money I have saved (as well as building a credit history for said mortgage).

I checked my Experian credit score and it was 966/1000. I know having a search on your history can dramatically change that rating so I want to know two things:

1) What are my chances of getting a loan for a car with an interest rate of around ~5%

2) What are the odds of the Co-Op bank giving me a loan - with there current situation. Should I just not apply with them (since it would badly affect my chances of getting approved with someone else)?

It should be noted I have my current account and credit card with the Co-Op Bank for about 18 months now.

CLAPTON

why would anyone take out a loan at 5% or more when they have saving earning say 1.5%?

a single search won't make a lot of difference to your credit record

Thrugelmir

madmax42 wrote: »

and have outgoings of around £500/month (rent & phone bill).

That's a slight understatement of your outgoings I suspect.

bouncydog1

As you must be saving £1100 per month, why don't you use 2 months savings to pay for a good second hand car - no credit search, no loan, no interest to pay and lower depreciation than buying a new car. No brainer in my view.

of course if you don't save £1100 per month then you are spending more than you think so need to review your budget.

PeacefulWaters

You may well get the loan you want.

But it will rightly reduce the amount any mortgage lender will advance you to buy a house.

Maybe you should prioritise what's most important. Nice shiny car or new home. If it's the latter, lower the car buying budget drastically and don't take out the loan.

matttye

The credit scores provided by Experian, Equifax and Callcredit/Noddle mean nothing. Lenders don't get to see them, but will instead score you using their own criteria based on the information you put in your application form and the information in your credit report (not score).

Do you have any adverse information in your report? Missed payments, defaults etc.

Have you considered HP or PCP and using some of your savings as a deposit rather than all of it?